Continuing his Opinionator series on ways to reduce health care spending, Dr. Ezekiel Emmanuel points out that each year administrative costs account for $360 billion of our health care spending, roughly fourteen percent of our health care tab.
The administrative costs of our health care system dwarf the amount we spend on all aspects of medical malpractice — from treating the malpractice to paying victims and lawyers for the injuries.
These administrative costs include the amount that insurance companies spend processing (and denying) claims, the amount that doctors spend on office staff needed to interact with the insurance companies and the amounts spent on third-party billing services.
Dr. Emanuel suggests that switching over to digital medical records could save at least $32 billion a year.
Of course, the single biggest thing that we could do to reduce administrative expenses is switch over to a single-payer “Medicare for all” system. But it would be imprudent for someone in the administration actually to say that.